Search form

Search

Taxes

End Offshore Tax Havens

Tax evasion through offshore tax havens costs America at least $150 billion in lost revenue every year. Every business needs to pay its fair share of taxes to maintain and modernize the infrastructure and services all companies depend on for a strong economy. Our economic progress is undermined when the tax code rewards financial manipulation rather than innovation and productive investment.

Vertical Tabs

Take Action

Dear Representative,

As business owners, executives, and investors, we call on Congress to enact strong legislation to stop tax haven abuses and support a level playing field for all U.S. companies. Offshore tax havens retard our efforts to modernize infrastructure and services a strong economy needs, and offload unfair tax burdens onto responsible businesses and households.

Our economy suffers when companies are rewarded for financial manipulation rather than innovation and productive investment. And responsible businesses are hurt when others use tax havens to avoid paying their fair share of our country’s upkeep.

Effective legislation to stop tax haven abuse must:

Prohibit a business from incorporating in a tax haven, pretending to be a foreign corporation for U.S. tax purposes while taking advantage of all the protections infrastructure paid for by U.S. taxpayers.

Prohibit hedge funds from engaging in transactions designed for the sole purpose of avoiding taxes on dividends.

Put into the Internal Revenue Code the “economic substance doctrine,” eliminating tax benefits for transactions that have no real business purpose apart from avoiding taxes

Impose restrictions on foreign jurisdictions and financial institutions that launder money and impede U.S. tax enforcement.

Increase disclosure of offshore accounts and close foreign trust, equity swap, and other loopholes used to avoid or evade taxes.

We urge you to end tax haven abuse and make our tax system transparent, fair, and responsible. This will greatly improve the public’s and businesses’ trust and will discourage the irresponsible speculation and financial manipulation that damages our whole economy.

Respectfully,

Latest Developments

Latest Developments:

Senate Finance Committee Chairman Ron Wyden (D-OR) introduced a package of tax provisions, known as “tax extenders.” These are provisions that expire and have been routinely extended in the past. There are a number of productive provisions included, such as the production tax credit and the new markets tax credit. ASBC has advocated for eliminating two of the worst provisions, the CFC look-through and the active financing exception, both of which are abusive. .We will continue to work to keep these bad provisions out of a final bill, which is expected to come to a vote in the lame duck session of Congress in November.

In September 2013, Sen. Carl Levin (D-MI) and three co-sponsors introduced legislation to close several offshore tax loopholes, including the practice of setting up offshore tax havens - which are often no more than a post office box - to avoid paying taxes. The "Stop Tax Haven Abuse Act" is expected to provide $220 billion in additional tax revenue over 10 years, according to the Joint Committee on Taxation.

Background

Background:

The official corporate tax rate in the United States is 35 percent, but a 2010 report from the Government Accountability Office (GAO) found that the largest corporations paid an effective rate of 12.6 percent that year. Some of that drastically lower rate was made possible by the use of offshore tax havens. These tax havens provide cover for banks, hedge funds, and corporations to shift taxable income from the United States to tax havens for the sole purpose of escaping taxation. Tax haven secrecy allows wealthy Americans to hide assets and helps companies manipulate their finances. Offshore tax havens reward companies and individuals who offload taxes to responsible businesses and households.

Passing strong legislation to end tax haven abuse will help create a level playing field and support responsible business owners and investors who pay their fair share for the opportunities America offers. Ending tax havens will show that we are serious about enacting taxation that is transparent, fair, and responsible. It is an important step in ending the irresponsible speculation and financial manipulation that puts our whole economy at risk.

What's at Stake

What's at Stake:

Taxes are how we pay for all the government investments and services we all want—and taxes can be a way to reduce economic inequality and provide incentives for sustainable economic development. But too often, the business voices that speak loudest to policy makers and the media are those of super-sized corporations and corporate groups that can afford a powerful echo chamber of lobbyists and PR operations who want government subsidies, bailouts and contracts while paying little or no taxes. These companies do not represent the views of business as a whole, and leaders like you must speak out in support of better tax policies.